Is anyone still doing wraps?

A couple of years ago wraps (wrap around mortgages) were the flavour of the month (and then years). It now seems rare to hear of anyone still involved in wraps. Is anyone still actively involved with the wrap business? If so, has the fall and flattening of the property market affected the wraps industry?

Careful property selection would be the key with wraps now, as there would be a real danger of negative equity occurring when your clients come to refinance a year or two down the track (a la Rick Otton style).
It has been quieter on the usual wrap circuits, but I'm sure that hasn't stopped the serious wrappers coming up with other money-making techniques.
For those true entrepreneurial types, there's always another way

This is a general comment only and does not constitute advice. Before making financial decisions you should seek advice from a professional adviser, who can take into account your specific circumstances and investment goals.

I have some friends who are still wrapping. I have been dealing in lease options for the past 5 years. I have a real estate searching for purchasers and then I buy a house and give the purchasers three years to buy it. I factor in a cg of 5percent per year which is pretty conservative. Steve is not overly excited about these as I lose equity, so I am not purchasing any more

I have some friends who are still wrapping. I have been dealing in lease options for the past 5 years. I have a real estate searching for purchasers and then I buy a house and give the purchasers three years to buy it. I factor in a cg of 5percent per year which is pretty conservative. Steve is not overly excited about these as I lose equity, so I am not purchasing any more

Bob

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Ah, perhaps the biggest downfall with wraps and LO's- the loss of your equity
So how has your strategy changed now Bob?

This is a general comment only and does not constitute advice. Before making financial decisions you should seek advice from a professional adviser, who can take into account your specific circumstances and investment goals.

I personally got out of wraps over two years ago when I found that there was very little profit to be made any more as rental yields had halved in a 12 month period (I also found out how much problem's it can cause for serviceability as well).
At least one good thing came out of it - I was able to help 2 families get into property before it boomed in outer Brissie. Just missed out on most of that capital growth for myself thems the breaks !!!

I personally got out of wraps over two years ago when I found that there was very little profit to be made any more as rental yields had halved in a 12 month period (I also found out how much problem's it can cause for serviceability as well).
At least one good thing came out of it - I was able to help 2 families get into property before it boomed in outer Brissie. Just missed out on most of that capital growth for myself thems the breaks !!!

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Serviceability can be a real factor- good point.
I guess the thing to remember with wraps is that you're taking your capital growth all up front (either when your client refinances or pays you out) so it's a set amount. In a non-boom market, this could also be beneficial. However, in a rising market, I would prefer the unpredictable (but usually higher) cg anytime!

This is a general comment only and does not constitute advice. Before making financial decisions you should seek advice from a professional adviser, who can take into account your specific circumstances and investment goals.